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Recent weeks have seen several headline-grabbing instances of alleged financial frauds, leading directly to the bankruptcies of the First Brands and Tricolor corporate enterprises. Both companies are alleged to have engaged in deceptive off-balance sheet financing and double-pledging of collateral, tumbling into bankruptcy after these issues came to light. While their lenders will have to seek their recourse in costly and lengthy bankruptcy proceedings, the cases serve as sobering reminders to lenders of the critical importance of vigilant oversight and the need for transparency into their borrowers’ activities in today’s active and complex lending environment.Continue Reading Use of Field Exams and QOE Reports to Safeguard Lenders in Risky Times

On Wednesday, November 5, the U.S. Supreme Court will hear arguments on whether President Trump’s tariffs—imposed under the International Economic Emergency Powers Act (IEEPA) —were legal. The Court’s decision will have significant impacts for importers, as well as investors in the IEEPA tariff claims. Many investors have participated in the growing secondary market, in which…

Much has been made in the legal press and elsewhere following litigation funder Burford Capital’s announcement of its intention to purchase minority stakes in U.S. law firms. Since, except in a few specific U.S. jurisdictions, legal ethical rules prohibit actual ownership of law firms by non-lawyers, Burford was apparently referring to a structure known as “Management Service Organizations” or MSOs. The MSO structure for law firms entails a law firm essentially splitting into two parts: one part being the legal service providing, client-facing portion and the other part being the MSO, which will take over all other law firm functions: administration, accounting, technology, recruiting, HR, real estate, etc. – anything not directly related to the practice of law. As with any other vendor, the MSO is paid a fee for providing these services.

While MSOs are a relatively new phenomena in the law firm space, they have long been a staple in other industries, most notably in health care. Numerous health care providers, especially physicians’ practices, have taken advantage of outside capital and expertise in order to remove much of the administrative burden of running a practice and allow the doctors and nurses to focus on the practice of medicine. The adoption of MSOs in the health care field has been fairly widespread: other service industries like accounting and architecture have also adopted this model on a smaller scale. Many private equity investors (and litigation funders) are now looking to law firms as the next investment frontier.Continue Reading Let’s Buy a Law Firm! – Management Service Organizations

Crowell has been shortlisted for “Exceptional Legal Services Provider for Litigation Funders (US-based)” by the International Legal Finance Association for its inaugural Legal Finance Awards.

The award recognizes law firms that provide direct and invaluable support to funders in creating deals, portfolio management, and other operational outputs, with a strong reputation in the sector for…

Tom Dell’Avvocato has joined Crowell & Moring U.K. LLP as a partner in its Financial Services Group. Dell’Avvocato brings extensive experience in non-contentious banking and finance transactions, with a focus on domestic and cross-border asset-based lending, as well as leveraged and specialty finance. He advises alternative and private capital providers, bank and non-bank lenders, and corporate borrowers on the structuring, restructuring, and execution of complex financing arrangements.Continue Reading Asset Based Finance Lawyer Tom Dell’Avvocato Joins Crowell & Moring in London